SpiceJet (SG, Delhi International) and Credit Suisse have signed and concluded “the settlement and consent terms” for a dispute that dates back to an unpaid engine maintenance and repair agreement that was signed more than a decade ago.
The low-cost carrier said on May 25 that the terms had been executed two days previously and had already been filed before India’s Supreme Court “for final orders.”
“The settlement involves payment of a certain amount upfront and balance amount over a mutually agreed timeline,” SpiceJet said without specifying the sums involved.
It only recalled what it had said about the case two months ago, that it had “provided a bank guarantee of USD5 million on the direction of the Madras High Court in the matter and there is no adverse financial liability on the company.”
The low-cost carrier had allegedly failed to pay USD24.01 million to the Swiss MRO firm SR Technics for the maintenance of aircraft engines, modules, components, assemblies, and parts under a contract dated November 24, 2011. In September 2012, SR entered into a financing deal with Credit Suisse under which it assigned all its rights to claim payments.
After years of failing to coax a response out of the carrier, the investment bankers approached the Madras court in 2015 to plea for payment. In December 2021, Credit Suisse issued a winding up order against SpiceJet. The case was taken to the Supreme Court the following month but was ultimately settled out of court.
SpiceJet wrapped up its May 25 statement by saying that the deal with Credit Suisse followed its “successful settlements” with De Havilland Aircraft of Canada (in a dispute that tied up in December 2021), with Boeing (settling in November outstanding claims related to the grounding of its B737 MAX fleet), with lessor CDB Aviation (also related to the MAX and settled last September), and with BOC Aviation, Avolon, and others.
“This provides an impetus to the normalisation, growth, and expansion of the airline,” SpiceJet’s statement concluded.
